Phishing Triggers Majority of Cyber Claims in 2022 First Half: Coalition
Claims are down among Coalition policyholders in the first half of 2022, but small businesses became bigger targets and an organization’s employees remain the easiest was for cyber criminals to infiltrate and pull off scams.
Coalition’s 2022 Cyber Claims Report mid-year update noted that businesses with revenue under $25 million in revenue saw a spike in average claims severity to $163,000 in the second half of 2021 – 85% higher compared with the first half of 2021. Through the first six months of 2022, severity decreased to an average $139,000 but that is still 58% more than values recorded in the first half last year, the cyber insurer and cybersecurity firm said.
“Organizations of this size are especially vulnerable to threat actors as they often lack resources to quickly respond to an attack,” Coalition said.
Phishing remains of high concern for business of all sizes because employees continue to be the weak link in cyber defenses. Coalition’s look at about 160,000 of the businesses it protects found that phishing accounted for a majority – about 58% – of claims during the first half 2022. That is a 32% increase from the second half of 2021.
Phishing through business email compromise often leads to funds transfer fraud (FTF), in which threat actors redirect or change payment information to steal. Coalition said the frequency of these incidents remained consistent but severity increased 3% to continue a 3-year trend of rising FTF claims costs.
The good news, according to Coalition, is that the frequency and severity of ransomware claims declined during the first six months of the year. Hackers’ ransom demands also decreased to $896,000 from $1.37 million for the second half of 2021.
“Organizations are increasingly aware of the threat ransomware poses. They have started to implement controls such as offline data backups that allow them to refuse to pay the ransom and restore operations through other means,” said Chris Hendricks, head of incident response. “As ransomware is on the decline, attackers are turning to reliable methods. Phishing, for example, has skyrocketed – and only continues to grow.”
Overall, Coalition said its policyholders experienced 50% fewer claims than the broader insurance market. The average loss was $175,258, a decrease of 8% compared with the second half 2021.
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